Today, Myanmar stands on the cusp of being able to realise its enormous economic and social potential. Political reforms in Myanmar have opened the door to significant trade and investment opportunities. Of course, Myanmar has been on a growth trajectory for twenty years now, since it joined ASEAN as a full member.
So today I would like to do two things. I would like to celebrate ASEANs first fifty years, and I would like to touch upon a couple of issues that will inevitably play into the future of Myanmars growth, prosperity, harmony and security.
When ASEAN took its first tentative steps, on 8 August 1967, few contemporary western commentators thought that it would be around in fifty years time. Indeed, I am not sure that any of the co-signatories the Foreign Ministers of Thailand, Malaysia, Indonesia, Singapore and the Philippines thought that their new association was much more than a gesture in the general direction of regional cooperation.
And when one looks back, the circumstances were not exactly propitious.
Indonesia was still recovering from the bloodshed and dislocation that precipitated the fall of Sukarno.
Singapore and Malaysia had gone their separate ways just two years previously.
Malaysia, Singapore and Indonesia had reached an agreement to end Konfrontasi only the year before.
The relationship between Malaysia and Thailand was characterised by suspicion and mistrust as Malaysia continued to suppress the insurgency on the peninsula, and Muslim separatists continued to harass the authorities in southern Thailand.
The Philippines was fighting a communist insurgency in the countrys south.
Thailand and the Philippines were locked into a war in Vietnam that was not going to end well.
Out of this, surprisingly, emerged ASEAN, united by little more than a strong opposition to communism and an ill-defined hope that regional relationships could be managed in a more peaceful and cooperative way.
As a regional organisation operating across linguistic and cultural boundaries, ASEAN has made steady progress. The 1971 Kuala Lumpur Declaration establishing the Zone of Peace, Freedom and Neutrality was followed by the 1976 Treaty of Amity and Cooperation. Both of these agreements gave additional ballast to the overall ASEAN approach to disputes and their resolution conciliation, negotiation and peaceful settlement.
ASEANs first decade and a half were years of consolidation, and the next fifteen years saw both an expansion in ASEANs membership and a significant broadening of its areas of cooperation and mutual support, with Brunei Darussalam joining in 1984, Vietnam in 1995, Laos and Myanmar in 1997, and Cambodia in 1999. PNG has been an observer since 1976 and Timor Leste since 2002.
ASEAN has also been very active in reaching out to other Asia-Pacific states as it establishes patterns of dialogue and consultation on political, economic and socio-cultural issues. ASEAN Plus Three quickly morphed into ASEAN Plus Six including Australia and New Zealand and ultimately into two mutually reinforcing bodies:
- the ASEAN Regional Forum, established in 1994, with a focus on political and security cooperation from North America to Europe; and
- the East Asia Summit, established in 1996, with a focus on security issues in East Asia.
But perhaps ASEANs most confident step was the establishment of the ASEAN Economic Community (AEC) in 2015. This was both an appreciation of an opportunity and the initiation of a plan for prosperity.
Collectively, the AEC is the third largest economy in Asia and the seventh largest in the world. According to IMF estimates, ASEANs GDP in 2017 will be just under $2.9 trillion larger than the GDP of India. With a market growing towards $3 trillion and a population of 630 million, ASEAN is evidently a region of great economic opportunity. And if one takes into account ASEANs youthful population and its human capital, the region is looking to significant growth dividends.
What the ten nations of the ASEAN Economic Community have done is to turn an opportunity into a plan for growth by leveraging proximity and the ease of communication. The resulting AEC Blueprint 2015 is competitive, innovative, dynamic, resilient, inclusive and integrated with the global economy. This is the new world in which Myanmar sits.
As The Economist Intelligence Unit noted in a 2015 comment, economic relationships between regional neighbours are poised to become even stronger but remarkably different in the years ahead driven by private-sector activity. The EIUs survey suggested that, while inter-regional production in North Asia was likely to cool over the coming decade, the shift in production from China to South East Asia meant that Myanmar, Vietnam and Thailand were the likely winners.
Of course, Myanmar will need to work hard to deliver on this economic potential, and it will need to plan ahead to avoid what development economists have called the middle income trap the point where attainment of a certain average income level can lead to economic stagnation. But the keys to maintaining growth are in your hands. They are: investment in infrastructure; investment in your people, including through increased regional cooperation in skills and development; and cooperation in technical innovation and research.
This cooperation-based and investment-dependent growth plan will also require you to maintain the pace and direction of political reform, ensuring that the people of Myanmar enjoy the level of political participation and control that comes with democracy. And it will also require you to ensure that the human, economic and political rights of all its peopleare respected and protected. Human rights are a by-product of a sound working democracy.
But notwithstanding ASEANs success in marking up a successful half century, the naysayers are still at large. Even The Economist Intelligence Unit, one of the more influential commentators on global affairs, described 2017 as a 50th anniversary to forget, highlighting the barriers to progress at the expense of ASEANs achievements to date.
Many Westerners are all too accustomed to contest and confrontation as the way to do business. So I suppose that it is difficult for us to understand the more consultative and conciliatory approach preferred in Asia. Musyawarah conversation as it is practised in Brunei, Indonesia and Malaysia, puts a premium on deliberation and discussion, and positively works around conflict and division.
This is a point that Professor Kishore Mahbubani makes very well in his essay ASEANs strategic diplomacy underpins regional stability. Writing in the April-June 2017 edition of the East Asia Forum Quarterly, Professor Mahbubani offers a subtle rebuttal of the view proffered by The Economist Intelligence Unit.
Professor Mahbubani makes two telling points. First, ASEANs ability to foster a culture of peace has been central not only to its own success but also to the creation of an indispensable diplomatic platform that encourages the great powers especially China and the US to engage within a neutral zone. And second, ASEANs neutrality helps to maintain peace and stability within the South East Asian region.
This, as its proponents call it, is the ASEAN way. It is also the Asian way. And the corollary of Professor Mahbubanis argument is that the great powers need to respect ASEAN and its neutrality since, as he puts it, the interests of both will suffer if ASEAN is damaged or destroyed.
So, to my mind, the real question is not just what has ASEAN achieved but more where would we be without it?
But those who have acquired a measure of impatience with ASEAN, for its avoidance of disagreement, have something of a point. While tensions may be kept under the carpet, as they were in 1967, they still need to be dealt with, as they also were in 1967.
For ASEAN to grow and prosper over the next fifty years, it will need to address some major obstacles to economic growth and economic integration.
Foremost among these, in my opinion, is the need to continue building on improvements in governance at all levels in the governments and public services of most of ASEANs members. Closely related to this is enhanced transparency in state finances, the integrity of the national revenue and expenditure institutions, and a concentrated attack on corruption and cronyism.
Greater political openness and political participation will drive economic performance by building trust in the national and regional economic systems. And while trust is the main driver of ASEANs informal economies, it is also a lack of trust that is holding back further investment at the national level. The truth is that democratic principles, that is, citizens participating in their own government, is not something to be afraid of, but rather something to be embraced. The consequences of democratic practice the rule of law, robust institutions and sound governance deliver the participation and the predictability that are the critical platform for greater prosperity.
Institution-building is a term that is easily thrown into discussion. It is significantly more difficult to achieve unless there is a concerted effort by individual governments, and genuine cooperation between the ASEAN members and their international partners. This is one of the areas where cooperation between ASEAN and its Australian, New Zealand, North American and European partners can pay off.
And it is an area on which the next Australian Labor government will place a premium. If ASEAN grows economically, building its capital base, its employment base and its trade links, Australia will benefit too. This was the principal thinking that drove the ASEAN Australia New Zealand Free Trade Agreement (AANZFTA) that was such a signal achievement of the Rudd and Gillard Governments.
And the outcome of that thinking was not only the most comprehensive trade agreement covering all sectors negotiated by ASEAN so far, but also the first multilateral trade agreement negotiated by Australia and New Zealand together. We can look forward to the coming years with confidence and hope, since we have put in place the essential prerequisites for a sound economic relationship.
As we celebrate ASEANs fiftieth birthday, we should look forward confidently to its centenary as an association with a regional footprint and a global significance. I think that the hopes of its five founders Tun Razak, Thanat Khoman, Adam Malik, Sinnathamby Rajaratnam and Narciso Ramos have in very large measure been realised.
The task ahead for ASEAN, as it enhances its economic role, is a real one.
But it is one that the energy, imagination and innovation of our South East Asian neighbours will fulfil in a way that both transforms ASEAN and enhances the stability, security and prosperity of the entire Asian region.
And this is the world of opportunity in which Myanmar finds itself.
